2 men accused of illegally funneling cash to candidates

Two northeast Ohio businessmen were arraigned and pleaded not guilty Wednesday to illegally funneling $190,000 to Republican state Treasurer Josh Mandel’s 2012 Senate campaign and the Congressional campaign of U.S. Rep. Jim Renacci (R., Wadsworth).

Benjamin Suarez, 72, of Canton, and Michael Giorgio, 61, of Cuyahoga Falls, were named in the indictment that was unsealed Wednesday by the U.S. attorney’s office in Cleveland.

The FBI investigation that led to the charges was triggered by a story in The Blade two years ago that focused attention on a suspicious number of $5,000 contributions — the maximum allowed under federal election law — from employees of a North Canton direct-mail company, Suarez Corp., and some of their spouses.

Federal campaign-finance law prohibits a corporation from providing bonuses or salary increases to employees to reimburse them for political contributions.

The Suarez Corp. then had 800 associates, according to the company’s Web site, including one division that specialized in collectible coins.

Some of the employees who gave were identified in Federal Elections Commission documents as executives. Others listed their occupation as “writer,” “copywriter,” or merely “marketing.” Some had never given to a campaign before.

According to the indictment, Mr. Suarez’s employees and their spouses gave $100,000 to Mr. Mandel’s campaign and $90,000 to Mr. Renacci’s campaign. In addition, Mr. Suarez and his wife, Nancy, each gave $5,000 to each of the campaigns, though those contributions were not cited in the indictment.

Mr. Suarez and Mr. Giorgio were released on $50,000 bond each. They are accused of one count of conspiracy to violate campaign-finance laws, two counts of violating campaign-finance laws, two counts of making false statements, one count of conspiracy to obstruct justice, and one count of obstruction of justice. Mr. Suarez also faces an additional count of witness tampering.

They each face up to 20 years in prison.

The indictment says Mr. Suarez was being solicited for contributions of $100,000 from Mr. Mandel. The state treasurer raised money aggressively during 2011 — which was also his first year as state treasurer — for his unsuccessful challenge to U.S. Sen. Sherrod Brown (D., Ohio) in 2012. Mr. Renacci defeated incumbent U.S. Rep. Betty Sutton (D., Copley Township).

Both politicians issued statements Wednesday disclaiming knowledge of the alleged illegal activity and saying they cooperated fully with the investigation.

James Slepian, chief-of-staff and spokesman for Mr. Renacci, said the Justice Department has made clear that Mr. Renacci was not the target of an investigation and was not suspected of improper conduct. He said all contributions associated with Mr. Suarez were returned “out of an abundance of caution” more than a year ago.

“What’s been made clear is that Mr. Renacci and the other candidates who received contributions from these donors have been absolved of any wrongdoing and this is now strictly a matter between the named individuals and the Justice Department,” he said.

Rebecca Wasserstein, a spokesman for Mr. Mandel’s 2014 re-election campaign, issued a statement that, “Neither Treasurer Mandel nor his campaign committee have been accused of any wrongdoing. Treasurer Mandel has a deep respect for the justice process and his campaign has fully cooperated with the investigation. Out of an abundance of caution, these contributions were returned over a year ago.”

The document says that Mr. Suarez and Mr. Giorgio recruited company employees or associates to serve as conduit contributors, and were informed that their and their spouses’ contributions would be fully reimbursed by the company.

The two allegedly disguised the payments as salary, and then as profit-sharing. After the suspicious contributions were reported in The Blade, Mr. Suarez and Mr. Giorgio allegedly created a fake “advance on profit-sharing” document and attempted to recoup the money from their employees.

The indictment details 18 contributions, all made in March, 2011, to the House campaign. It also details 20 contributions, all but one made in May, 2011, to the 2012 Senate campaign.

The case is similar to that of former Toledo-area Republican Party boss Tom Noe who pleaded guilty in 2006 to funneling $45,000 through 24 conduits to the George W. Bush re-election campaign in 2003. Noe was sentenced to 27 months in prison and fined $136,200 in his case.